Blackhawk Community Credit Union is asking the city of Janesville to cover site preparation costs for its proposed downtown headquarters instead of a more traditional tax increment financing deal.
Under the arrangement, the city would pay an estimated $7.1 million upfront to acquire and demolish properties, relocate utilities, and perform an environmental cleanup, according to a city memorandum.
That contrasts with the city’s original offer—a 15-year, $6.1 million, pay-as-you-go TIF deal plus $1.9 million in upfront costs for an $8 million city investment.
Pay-as-you-go TIF deals are standard for many municipalities. Cities reimburse a portion of the developer’s annual property taxes for the deal’s duration to help the developer recover costs.
Blackhawk’s proposed headquarters, known as Reflections Plaza, would be located along the eastern shore of the Rock River, sandwiched between East Court Street and Hedberg Public Library. It would be a multipurpose building with room for other tenants.
Blackhawk CEO Sherri Stumpf said the company’s new request is not a “nontraditional” incentive. The city often pays to acquire and demolish buildings, and it has already done so on this site—paying $750,000 to buy and raze the former Mercy Options building at 20 E. Court St.
When discussions between Blackhawk and Janesville officials began in early 2018, the credit union originally intended to buy several privately owned parcels, according to the memo.
But last month, Blackhawk said it wanted the city to buy the former Rock County Jail site, the vacant Bee Line Wheel Alignment building and the functioning Nowlan and Mouat law firm, according to the memo.
Nowlan and Mouat is aware it could be forced to move, Deputy City Manager Ryan McCue wrote in an email to The Gazette.
Acquiring those three properties would cost $4.25 million. The city still would be on the hook for demolition, environmental cleanup and utility relocation, like it originally offered Blackhawk. But it would pay more interest on debt to finance the added upfront costs, according to the memo.
Janesville would sell those parcels and others it already owns to the credit union for $1.
Stumpf served on an early committee for ARISE, a public-private effort to revitalize downtown. The ARISE plan listed this site as one where the city would help finance its preparation for development, she said.
Blackhawk is not responsible for any contaminants found on the site, so it believes the city should get it ready, she said.
The credit union could choose to locate the project elsewhere, but it sees downtown as a place where its construction could spark further revival, she said.
McCue said city officials could not recall an upfront package for as much as $7 million.
City council President Doug Marklein and Vice President Tom Wolfe both said they had not formed opinions on Blackhawk’s idea. Neither could recall a previous incentive that eschewed tax breaks for upfront financing.
The council will discuss the deal Monday night. It is not an action item; the council will only provide guidance to city officials for the next step.
Wolfe said having an early discussion will increase transparency before the council takes future action.
Marklein said he was “intrigued” by the idea and praised the outside-the-box thinking. There’s more than one way to make the project happen, he said.
In Blackhawk’s eyes, the new request makes the project as simple as possible. Janesville readies the site, and the credit union focuses on construction, Stumpf said.
“We knew it was going to be complicated,” she said. “But I think if everybody does the area that’s their expertise, isn’t that the best of both worlds? The city does this every day. They have professionals who do this for a living.
“I’d rather leave that in their hands.”
Janesville City Manager Mark Freitag told the powerful state Joint Finance Committee on Friday he is encouraged by proposals in Gov. Tony Evers’ 2019-21 state budget plan.
Freitag spoke at the committee’s first public hearing on the governor’s budget at the Pontiac Convention Center. Janesville Police Chief Dave Moore told a Gazette reporter about 250 people were inside the center when the hearing began at 10 a.m.
Friday’s hearing was the first of four the budget-writing committee is hosting across the state this month. The others will be in Oak Creek, River Falls and Green Bay.
The committee is tasked with editing and amending Evers’ budget before it heads to the Legislature. It then will go back to Evers for final approval.
Freitag told the committee the city supports Evers’ proposal to increase county and municipal aid by 2%, saying the boost could give the city another $115,000 in shared revenue.
But he said the proposal “does not go far enough.”
Eighty-three percent of the city’s revenue stream comes from property taxes or shared revenue, Freitag said, and Janesville is last among its 15 peer communities in its ability to generate revenue.
Freitag also praised Evers’ proposal to allow counties and municipalities to raise their levy limits by 2% regardless of net new construction, an idea that Rock County Administrator Josh Smith likewise has supported.
Janesville’s net new construction rarely outpaces inflation, Freitag said, and the cumulative negative effect of levy limit restrictions over time is insurmountable.
“Why are municipalities penalized for bringing jobs to our communities and growing?” Freitag asked the committee.
Smith also addressed the committee Friday, touting Rock County’s Ground Water Nitrate Work Group. He lauded the Speaker’s Task Force on Water Quality and Evers’ call to make 2019 the year of clean drinking water.
Smith said the opioid epidemic continues to disproportionately affect area children. In the last five years, he said, the number of children in out-of-home placement has doubled, and Rock County’s contribution to child welfare has increased by 70%.
Evers has proposed a $15 million hike in the Children and Family Aids allocation.
State Rep. Amy Loudenbeck, R-Clinton, is vice chairwoman of the committee. State Reps. Deb Kolste of Janesville, Don Vruwink of Milton and Mark Spreitzer of Beloit and state Sen. Janis Ringhand of Evansville—all Democrats—also attended the hearing.
At noon, Ringhand and Spreitzer joined a press conference held by Citizen Action of Wisconsin outside the convention center. They urged the committee to accept more federal Medicaid dollars to expand BadgerCare Plus, which Evers has proposed in his budget.
That would save the state about $324 million, they said.
“This is not a partisan issue. It’s not Democratic or Republican, and we just need to adopt the expansion because it greatly benefits all of our citizens,” Ringhand said.
In an interview with The Gazette, Loudenbeck said Evers’ proposal allowing local governments to raise their levy limits by 2% would have trouble gaining traction in the Legislature.
The tax increases will start adding up, she said, and residents generally have been satisfied with declining taxes over the past six years.
She said she is “skeptical” about expanding Medicaid but said the state should look at raising Medicaid reimbursement rates to providers.
Loudenbeck praised the Janesville community Friday, saying the introductions from city and county officials to the committee were welcoming, and she applauded the turnout.
Some of the budget proposals supported by speakers Friday included:
Rock County Sheriff Troy Knudson was one of the last people to speak around 5:45 p.m. He told the committee there is a “serious lack of treatment locally” for drug addiction, particularly inpatient treatment.
He also said the state should look at temporary housing for people being released from custody.
In an interview after the event, Kolste echoed Loudenbeck, saying the event was “fabulous” and well-run.
“It think it’s important to showcase Janesville, and I thought we did that well,” Kolste said. “It was fun. Long day.”
Gerald W. “Jerry” Hanthorn
Christopher P. Kubly
Anita L. Lundberg-Stanhope
Dale Sylvan Sperry Jr.
The man authorities believe supplied the handgun used in a 2016 drive-by shooting that killed a 5-year-old Beloit boy will serve 15 years in prison, a Rock County judge ruled Friday.
Judge Michael Haakenson handed Isaac Torres, 27, of Beloit the maximum sentence for his role in the January 2016 death of Austin Ramos Jr., who prosecutors say was shot as he rode in a vehicle driven by his father.
It’s the third sentencing in the case and the second time this month Haakenson has handed down a stiff sentence for people charged in the shooting. He said it should serve as a warning to criminals who would commit “gang-related” gun violence or take the law into their own hands.
The sentencing came after Ramos’ mother, Jasmin Martinez, and his grandmother, Alicia Martinez, spoke in court of the pain they’ve had to relive through multiple hearings on the 5-year-old’s death—a crime Rock County Assistant District Attorney Mason Braunschweig called “an incredible tragedy.”
“I don’t know that there’s a worse crime in this world” than the killing of a child, Braunschweig said Friday as he asked for the maximum sentence.
Torres is one of four men charged in the shooting. He and two others, Hugo Martinez and Eric Salazar-Mota, pleaded guilty to party to second-degree reckless homicide.
Salazar-Mota was sentenced to 14 years in prison and 10 years of extended supervision for riding in the vehicle Sergio R. Ortiz, 26, was in when he shot a .357-caliber bullet through the door of the vehicle Ramos was riding in.
The bullet traveled through the boy’s side, and he died the same day “on a cold hospital table” after “battling for his life” for three hours, Braunschweig said.
Ortiz pleaded guilty to first-degree reckless homicide and was sentenced Nov. 9 to 40 years in prison plus 20 years of extended supervision.
On Friday, Braunschweig said authorities believe—based on witness accounts—that Torres brought the revolver used in the shooting and that Torres had been riding in the front passenger seat with the gun in his lap.
Braunschweig said investigations showed Torres put the gun on the floor of the car before Ortiz grabbed it, hung out the window and shot at the car where the boy was.
In statements to police, Torres did not admit he had brought a gun that day, and he has never admitted bringing a gun, Braunschweig said. Torres’ statements helped bring justice in the killing, but Braunschweig said he believes Torres’ claims that he didn’t bring the gun are a “glaring lie.”
“It was Torres’ revolver. He brought it. He put it on the floorboard,” Braunschweig said. “He wants us to believe he was deaf, dumb and blind that night. It’s not true. He didn’t take full responsibility for what he did.”
During some of his more than 1,000 days in jail, Torres has sought to avoid contact with others charged in the shooting.
That’s because Torres said he wanted to dissolve gang ties he had maintained from 2008 to 2016 through his association with Ortiz, a suspected gang member, according to investigations of a string of earlier crimes Torres had been charged with, Braunschweig said.
Torres fled to Illinois before talking to police, Braunschweig and Haakenson said Friday. He also has tried to downplay his past gang involvement with Ortiz and others, they said.
Before his arrest, Torres had phone and Facebook discussions about plans to get rid of two guns that were in the vehicle when Ramos was shot—including the revolver used in the shooting, Braunschweig said.
One of the plans, he said, was to trade the guns to someone who was selling a car on Craigslist.
Before pronouncing his sentence, Haakenson outlined the history of criminal charges Torres faced over a nine-year span prior to the 2016 shooting, including the brutal beating of a man after an argument over a billiards game among gang members.
In addition to a 15-year prison sentence, Torres must serve 10 years of extended supervision. Haakenson said he doesn’t buy Torres’ story that he didn’t bring the gun used in the shooting.
Haakenson said he’s convinced Torres “was part of a group think” in a plan to avenge an earlier shooting that killed one of Ortiz’s relatives.
Haakenson said Torres’ record and association with Ortiz makes it clear he was a gang member and the shooting was gang-related.
He called Torres “significantly responsible” for providing what became the murder weapon in the shooting of a child.
Torres’ attorney, Ashley Morse, said her client has worked to sever ties with gang life and those charged in the shooting.
She asked for a lighter sentence, saying it was Ortiz’s decision to pick up the gun and shoot someone.
Torres apologized to Ramos’ family, telling them “no child deserves to die.”